Tuesday, September 19, 2017

You cannot rest on your laurels when it comes to improving business environment

Interview with Tan Sri Yong Poh Kon, former co-chair of PEMUDAH, Malaysia’s counterpart of the Myanmar Business Forum

Tan Sri Yong Poh Kon, former co-chair of PEMUDAH, Malaysia’s counterpart of the Myanmar Business Forum, speaks to The Myanmar Times during an interview on August 14 in Kuala Lumpur. Thompson Chau/The Myanmar TimesTan Sri Yong Poh Kon, former co-chair of PEMUDAH, Malaysia’s counterpart of the Myanmar Business Forum, speaks to The Myanmar Times during an interview on August 14 in Kuala Lumpur. Thompson Chau/The Myanmar Times

The task of facilitating public-private collaboration and improving the country’s competitiveness is not a one-off project but an endless race, a business leader who played a pivotal role in promoting public-private sector dialogue in Malaysia told The Myanmar Times.

Tan Sri Yong Poh Kon was invited by Myanmar’s PSD (Private Sector Development) Committee to share his experience in leading Malaysia’s business facilitation taskforce as part of the PSD framework and action plan workshop on April 5 in Nay Pyi Taw.

The PSD Committee was formed in October last year. It is chaired by the first Vice President U Myint Swe and supported by the Minister for the Ministry of Commerce U Than Myint as vice chair.

The Myanmar Times sat down with Mr Yong in his company’s headquarters in Kuala Lumpur on August 14 to review the experiences of Malaysia in addressing bureaucracy in business-government dealings.

Tan Sri Yong Poh Kon is the former co-chair of PEMUDAH (2007-2013). PEMUDAH refers to the Special Task Force to Facilitate Business, taken from the task force’s Malay name “Pasukan Petugas Khas Pemudahcara Perniagaan”. He is the chair of Kuala Lumpur-headquartered Royal Selangor International, a pewter company.

In Myanmar, the equivalent of PEMUDAH is the Myanmar Business Forum (MBF), a platform for dialogue between the private sector and government. Its objective is to improve the business environment by promoting regulatory reforms. Last month, the International Financial Corporation (IFC) handed over the MBF secretariat to the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI).

The Royal Selangor Visitor Centre in Kuala Lumpur. Royal Selangor International was founded in 1885 and its pewter products are found at luxury outlets and retail stores internationally. Thompson Chau/The Myanmar TimesThe Royal Selangor Visitor Centre in Kuala Lumpur. Royal Selangor International was founded in 1885 and its pewter products are found at luxury outlets and retail stores internationally. Thompson Chau/The Myanmar Times

Political will for private-public sector dialogue necessary

The idea for a high-powered taskforce to tackle bureaucracy to improve the business environment was first introduced by the Malaysian Prime Minister in his annual speech to the civil service in January 2007. Mr Yong said that Putrajaya had the political will to bring about a concerted, cross-ministerial initiative to enhance the way government regulates businesses.

“You have to understand that the prime minister at that time was Abdulla Badawi. He was a civil servant – originally before he went into politics – and he knows how the civil service works. And at that time, there was a lot of civil service-bashing – you’re ‘bureaucratic’, ‘very slow’ and ‘not responsive’.

“So he thought the best way was to get into the private sector to work together with senior civil servants and to look at issues where there are ‘bottle-necks’.

“There was an expectation that the private sector would tell civil servants exactly what the problems were, and civil servants would express what problems that they’d face – collectively, they’d be able to resolve matters,” he said.

The other key development is the formation of taskforce, he added. Tan Sri Mohammad Sidek Hassan, who was promoted to the top civil servant – the chief secretary – had been a trade commissioner in various countries and he had a grasp on how businesses worked overseas. Both Tan Sri Mohammad Sidek Hassan and Tan Sri Yong Poh Kon himself were appointed as the co-chairmen of the taskforce, together with business leaders from 10 industries and 13-14 senior civil servants. These 23-24 members met regularly.

The Royal Selangor chair said that it is crucial for every participant to attend the meetings without exceptions in order to make progress on the public-private sector dialogue.

“The cardinal rule was ‘no substitutes allowed’, you had to be there yourself – too often representatives, who had no idea about what was happening, would be sent to the meetings, which resulted in wasted time.

“Confidence was slowly built when we heard that civil servants started arguing among ministries in front of the private sector – reaching a stage of openness and trust-building to bring up any issue for resolution. That’s how we progressed,” he told The Myanmar Times.

Ease of doing business index

PEMUDAH focuses on improving the parameters set by the World Bank’s Ease of Doing Business (EODB) index. Mr Yong added the idea was that if the taskforce followed the 10 parameters of the World Bank’s EODB survey, then, collectively, the situation would improve. Examples of parameters include the process of obtaining construction permits and starting a company.

The most significant case study for the success of PEMUDAH involves the handling of court cases. Originally, Malaysia used to have a backlog of ten thousand court cases in the commercial courts, stretching back to eight to even 10 years.

“The backlog was so much so that if anybody wants to sign a commercial contract, they would want to say that the court of jurisdiction should be in a neighbouring country,” he explained.

The taskforce worked together with a retired Malaysian high court judge to convince the Malaysian judiciary to set up new commercial courts and implement revised procedures in order to increase the capacity of managing court cases.

“With the new measures, we were virtually able to guarantee that your case would be disposed of within nine months, which is a world-class achievement,” he noted.

However, the recipient of the Panglima Setia Mahkota warned that no complacency is possible in the task of improving business environment, because the competition never ceases.

“The World Bank’s EODB survey is an ever-continuous race – you may have solved your problems in your country, but there’s always another country which wants to do better, and they will jump ahead of you. So you can’t say that you’ve finished your job.

“When we first started in 2007, our World Bank ranking was 25 out of 170-180 countries. At the end of six years, we progressively brought it down – 20, 18, 12 – until at the end of 2013, we were number six.

“But in 2014, the organisation changed the methodology and we went back to being 18. Conditions change but, more importantly, it is the other countries which are jumping ahead of you.

“You cannot rest on your laurels,” he said.

Mr Yong said that he was “very impressed” by the civil servants who addressed the PSD Committee workshop, but stressed again that the civil servants and business leaders need to take part in the meetings themselves.

“They [the Myanmar civil servants] were genuinely interested to push the process forward, and – with the right committee – they will begin to make progress.

“But the most important thing is that the participants [of the meetings] must be the same participants, no alternates or representatives.”

Mr Yong also told The Myanmar Times that ASEAN and Myanmar’s population needs to improve its English proficiency to engage with the international economy competitively.